The objective of this project to inform renewed efforts to improve the quality of child care subsidized under through the Child Care and Development Fund (CCDF). Literature to date has primarily examined whether child care subsidies are associated with child care quality and stability, but little is known about the extent to which payment policies and practices, which vary across states, can mediate the relationship between subsidy receipt and quality of care. This study will combine data on payment rates and practices (drawn largely from the Child Care and Development Fund Policies Database) with a variety of quality indicators available in the most recent and comprehensive data set available: the National Survey of Early Care and Education (2012). First, the research team will draw on the Urban Institute's CCDF Policies Database to address the questions: (1a) How much do child care center and family child care home payment rates vary across states, both in absolute terms and relative to market rates? (1b) How much do payment practices and policies vary across states? The analysis will focus on provider-friendly policies and practices, that is, practices that affect provider willingness to participate in CCDF and the net amount and stability of CCDF revenues (e.g., use of contracts, payment for absences, copayment policies, and length of certification periods). The second research question to be explored is: (2) How much variation is there in the quality of child care centers and family child care homes attended by subsidized children? This question would use the NSECE to look at a variety of program and caregiver characteristics linked to child care quality, including child: staff ratios, staff turnover, caregiver education, caregiver experience, and professional development activities. Finally, the key analytical questions are: (3a) What is the association between payment rates and the quality of child care attended by subsidized children? (3b) What is the association between payment policies and practices and the quality of child care attended by subsidized children? Main analytic tools for this third set of questions will include multivariate regression analysis and propensity score matching (PSM), which can provide evidence of a causal link between payment rates and payment practices and child care quality. Answers to these research questions are of high policy relevance to federal policymakers and state administrators as they seek to improve the quality of early education and care for low-income children receiving child care subsides. The project will result in a user-friendly report of findings, a methodological paper, a policy brief, an article submitted to a peer-reviewed journal, and related blogs and poster presentations.